The Conservative Cave
Current Events => Economics => Topic started by: TheSarge on July 06, 2009, 08:01:45 PM
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The Department of Justice has started an informal review of the exclusive arrangements that limit handsets such as Apple’s iPhone to particular wireless communications companies, according to people familiar with the matter.
The inquiry follows consolidation in the US wireless industry that has left four operators accounting for more than 90 per cent of the country’s wireless subscribers. This has left them with the market power to carve out exclusive deals with makers of the most popular handsets, making it hard for smaller rivals to compete and leading to higher prices for mobile services, according to rivals.
AT&T and Verizon Wireless, which dominate the US mobile industry with more than 60 per cent of subscribers, said they had not been contacted by regulators and were unaware of any review. The Department of Justice declined to comment.
AT&T said: “The US wireless industry is highly competitive and, as a result, delivers terrific innovation, many choices and attractive pricing for all customer segments.â€
However, in recent days DoJ officials have contacted smaller operators to seek their views, according to people familiar with the situation. News of the antitrust regulators’ interest comes more than a year after the Federal Communications Commission received its first formal complaint on exclusive handset deals. The FCC said last month it would begin its own review of the matter.
The DoJ’s interest was welcomed by John Kerry, the Democratic senator for Massachusetts and a member of the Senate’s committee on commerce, science and transportation, which recently held hearings on the issue. “We need to know more about how these contracts affect competition in the marketplace and its impact on consumers,†he said.
The signs of increasing regulatory scrutiny of exclusive deals highlight a key structural factor that sets the US apart from most other wireless markets.
The French Competition Council late last year overturned Apple’s exclusive deal to sell the iPhone through a single carrier there, and Apple has given up its early attempt to use exclusive arrangements to promote the device in most countries. In the US, AT&T’s exclusive iPhone deal has accounted for a large proportion of new subscribers.
http://www.ft.com/cms/s/0/79d01e62-6a68-11de-ad04-00144feabdc0.html
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I think there may be a legitimate case here, but it is any different than game developers having exclusive deals with a specific game console manufacturer?
OTOH, maybe there is a little blackmail going on to get cooperation from AT&T and others.
Cybersecurity Plan to Involve NSA, Telecoms
DHS Officials Debating The Privacy Implications
The Obama administration will proceed with a Bush-era plan to use National Security Agency assistance in screening government computer traffic on private-sector networks, with AT&T as the likely test site, according to three current and former government officials.
President Obama said in May that government efforts to protect computer systems from attack would not involve "monitoring private-sector networks or Internet traffic," and Department of Homeland Security officials say the new program will scrutinize only data going to or from government systems.
WaPo (http://www.washingtonpost.com/wp-dyn/content/article/2009/07/02/AR2009070202771.html)
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Hmmm almost like the "Anti Dog eat Dog bill" in Atlas Shrugged